Enterprise Resource Planning

2012

Definition of Business Process Reengineering

BPR as, the fundamental rethinking and radical redesign of business systems to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service, and speed In this defenition four important key words: fundamental: "Why do we do what we do?" and "Why do we do it the way we do?" Reengineering ignores what is and concetrates on what should be. radical: Desregarding all existing structures and procedures and inventing completely new ways of accomplishing work dramatic: Used for quantum leaps in performance, not used for small jumps process: the most important key word, Collection of activities taking multiple inputs to create an output that is of value to the customer

The following roles are mostly involved by implementing reengineering at a company: 1. Leader: a senior executive who authorizes and motivates the overall reengineering effort 2. Process owner: a manager with responsibility for a specific process and the reengineering effort focused on it 3. Reengineering team: a group of individuals dedicated to the reengineering of a particular process, who diagnose the existing process and oversee its redesign and implementation 4. Steering committee: a policy-making body of a senior manager who develop the organization's overall reengineering strategy and monitor its progress 5. Reengineering : an individual responsible for developing reengineering techniques and tools within the company and for achieving synergy across the company's separate reengineering projects 6. The relationship between the roles is like this: 7. "The leader appoints the process owner, who convenes a reengineering team to 8. reengineer the process, with the assistance from the czar and under the auspices of

Enterprise Resource Planning

2012

Business Process Reengineering Phases & Activities

Phases and Activities
1. Planning & Start Up Identify key business drivers for change & assess consequences for not changing. Identify critical processes for reengineering. Identify executive sponsors & create steering committee of key stakeholders Gain executive support for the project. Define scope; establish measurable objectives; select methodologies; and establish a high level schedule. Obtain agreement with executive/senior managers on objectives & scope for the project. Select the team. Select consultants or outside experts, where applicable. Hold meeting. Brief functional managers about the goals of the project; begin communications to the organization. Train the team. (BPR; Benchmarking; Best Practices etc.) Begin change management activities and prepared a communication plan. 2. Research & Discovery Conduct benchmarking studies on the processes of other companies. (Includes best practices and Financial comparisons) Conduct interviews; surveys; focus groups to identify current & future needs. Interview employees and managers to understand issues and to brainstorm ideas for change. Conduct literature and periodical research to understand industry trends and to find best practices. Document As Is processes at a high level, collect performance data, identify gaps. Review technology changes & options. Interview stakeholders & key senior managers. Attend workshops or seminars. (eg. Benchmarking; Risk Assessment) Gather data from external experts & consultants. 3. Design Brainstorm new and innovative ideas; used creative thinking exercises to think outside the box. Conduct what-if scenarios and applied success templates used by other companies. Generate 3-5 models by using functional experts; develop hybrid model by taking the best of each. Create vision of ideal process. Identify approach to process (Extension; Augmentation; Conversion; Innovation) Define new process models & flow chart processes. Design organizational model to align to new process. Define technology requirements; select platform to enable new processes. Separate short and long term improvements. (Emulate processes that cannot be technology enabled immediately; allow flexibility for process change/enhancements.)

Enterprise Resource Planning

2012

4. Approval Prepare cost and benefit analysis; determine return on investment Assess impact on customers; employees; on competitive position. Prepare formal business case for senior managers/executives. Hold review meeting to present finds to steering committee & senior management for approval. 5. Implementation Complete detailed design of processes and organizational models; define new job roles. Develop supporting systems. Conduct pilot solutions and test on a small scale. Communicate new solution to employees; develop and implement change management plan. Develop phased implementation plan and implement solution. Develop training plan and train employees on new processes and/or systems. 6. Next Steps Define key measures to evaluate periodically; measure the results of the new process; implement continuous improvement program for the new process. Issue final report to steering committee & senior managers.

Advantages of BPR
1. Satisfaction A big advantage of reengineering is that the work becomes more satisfying because the workers get a greater sense of completion, closure, and accomplishment from their jobs. the employee performs a whole job, a process or a subprocess, that by definition produces a result that somebody cares about. The workers not only try to keep the boss happy or to work through the bureaucracy. More important is the fact to satisfy the customer needs. 2 Growth of Knowledge Furthermore, the personal development within a process team environment does not play such an important role which means climbing up the hierachy is a minor goal. In this case it is much more important to get a widespread knowledge of the whole process and there are no such things as "mastering" a job; as a worker's expertise and experience grow, his or her job grows with it. 3 Solidarity to the Company "Moreover, since workers in a reengineered process spend more time on value adding work and less time on work that adds no value, their contributions to the company increase, and, consequently, jobs in a reengineered environment will on the whole be more highly compensated.

Enterprise Resource Planning

2012

4 Demanding Jobs "There is, however, a challenging side to all this good news about work in a Reengineered environment. If jobs are more satisfying, they are also more Challenging and difficult. Much of the old, routine work is eliminated or automated. If the old model was simple tasks for simple people, the new one is complex jobs for Smart people, which raises the bar for entry into the workforce. Few simple, routine, unskilled jobs are to be found in a reengineered environment. 5 Authority In a traditional oriented company the management expects from the employees that they follow some specific rules. In contrast to that the reengineered companies "dont want employees who can follow rules; they want people who will make their own rules. As management invests teams with the responsibility of completing an entire process, it must also give them the authority to make the decisions needed to get it done.

Business Processes Definition: A Business process is a set of linked activities that create value by transforming an input into a more Valuable output. Both input and output can be artifacts and/or information and the transformation can be performed by human actors, machines, or both. There are three types of business processes: 1. Management processes The processes that govern the operation. Typical management Processes include "Corporate Governance" and Strategic Management". 2. Operational processes These processes create the primary value stream, they are part of the Core business. Typical operational processes are Purchasing, Manufacturing, Marketing, and Sales. 3. Supporting processes These support the core processes. Examples include Accounting, Recruitment and IT-support. A business process can be decomposed into several sub-processes, which have their own attributes, but also contribute to achieving the goal of the super-process. The analysis of business processes typically includes the mapping of processes and sub-processes down to activity level.